Question

At the beginning of the year, Nothing More, Corp., had a long-term debt balance of $38,554. During the year, the company repaid a long-term loan in the amount of $11,714. The company paid $4,710 in interest during the year, and opened a new long-term loan for $10,250. What was the cash flow to creditors during the year

Answer 1

Answer: $6,174

Explanation:

Cash flow to creditors during the year is the amount that was paid to creditors less the amount that was received from them.

The relevant formula is:

= Long term loan repaid + Interest paid - Addition to long term loan

= 11,714 + 4,710 - 10,250

= $6,174